Wayne Swan says customers will be disappointed by major banks not passing on the rate cut in full.Source: AAP

TREASURER Wayne Swan says customers of the nation's major banks will be "disappointed" they won't get the full benefit of this week's central bank interest rate cut.

The Reserve Bank of Australia (RBA) lowered the rate by 25 basis points, but the National Australia Bank and Commonwealth Bank of Australia held back five points, reducing their variable mortgage rates by 20 basis points on Friday to 6.58 and 6.60 per cent, respectively.

Westpac was even less generous, cutting by 18 basis points to 6.71 per cent.

"Customers will be disappointed," Mr Swan tweeted on the social media platform Twitter.

"If you're not happy with your lender, then have a look around for better value."

ANZ Bank won't review its rates for another week.

The treasurer praised ING Direct's decision on Thursday to cut its variable lending rate by the full 25 basis points, taking its rate to 6.09 per cent.

Shadow treasurer Joe Hockey said on Friday there was no justification for the banks not to pass on the reduction in full.

"The RBA, in its statement, actually said the banks are not under funding pressure," Mr Hockey told the Seven Network.

When the RBA made its move on Tuesday, it was linked to a slightly weaker growth outlook for next year because of "international developments".

Treasury boss Martin Parkinson appeared to back that view on Friday when he warned global economic volatility was likely to be a feature of the world economy for the next 10 years.

Dr Parkinson said while the European Central Bank's decision to buy up sovereign debt of cash-strapped European countries had relieved short-term debt pressures, euro area governments still needed to achieve closer banking, fiscal and political union.

But he also described the United States as the "elephant in the room" that could pose risks to the global outlook if it falls off a so-called "fiscal cliff" at the end of 2012.

"Unless politicians intervene, the scheduled tax increases and spending cuts are expected to weigh heavily on growth," Dr Parkinson told the John Curtin Institute of Public Policy in Perth.

"If that fiscal tightening goes ahead, the US economy could experience a recession in the first half of 2013 of a magnitude similar to the recession it recorded in the early 1990s."

The RBA had noted commodity prices were significantly weaker than a year ago, while Australia's terms of trade had declined by more than 10 per cent from last year's peak.

But Dr Parkinson, a RBA board member, expects the nation's terms of trade to remain high by historical standards.

"Instead of the boom-and-bust cycle, what we will see ultimately is mining becoming a much larger share of a reshaped economy," he said.

"The mining sector is expected to rise from five per cent of gross value added in the early 2000s, to in the order of 10-12 per cent in the decades to come."

These will be the result of mining investment providing greater capacity for extraction and exports.

He also said Australia risked missing out on opportunities unless it had a "mature" conversation about the role of government and the sustainability of the tax system.

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